Fannie Mae Lender Letter LL-2020-05: Payment Deferral
Updated 10/14/20: Fannie Mae updated its Payment Deferral Lender Letter to clarify that a borrower’s acceptance of a payment deferral will result in the mortgage loan’s withdrawal from HAMP and the loss of any future HAMP “pay for performance” incentives.
March 25, 2020
Source: Fannie Mae
We are introducing payment deferral, a new home retention workout option jointly developed with Freddie Mac at the direction of the Federal Housing Finance Agency. This workout option enables servicers to assist eligible borrowers who have resolved a temporary hardship and resumed their monthly contractual payments but cannot afford either a full reinstatement or repayment plan to bring the loan current.
This Lender Letter covers the following requirements for the payment deferral:
▪ Determining eligibility for a payment deferral
▪ Determining eligibility for a payment deferral for a Texas Section 50(a)(6) loan
▪ Determining the payment deferral terms
▪ Completing a payment deferral
▪ Processing a payment deferral for an MBS mortgage loan
▪ Processing a payment deferral for a mortgage loan with mortgage insurance
▪ Handling fees and late charges in connection with a payment deferral
▪ Incentive fees
▪ Servicing fees for a payment deferral
▪ Requesting reimbursement for payment deferral expenses
▪ Fannie Mae workout hierarchy
▪ Updates to Fannie Mae Flex Modification
▪ Reporting responsibilities for payment deferral
▪ Borrower Solicitation Letter (Form 745)
Effective: Servicers are encouraged to begin evaluating borrowers for payment deferral in accordance with this Lender Letter on or after Jul. 1, 2020; however, servicers must begin evaluating borrowers for payment deferral no later than Jan. 1, 2021. Also, these policy changes will be reflected in the Dec. 2020 update of the Servicing Guide.
To access full Lender Letter, please click the source link above.